O R D E R<br /> <br /> <br /> <br /> SRI.D. KRISHNAPPA, PRESIDENT:<br /> <br /> <br /> The grievance of the complainant against the Op in brief is, that considering variability for advancing loan, on his application BHW home Finance Limited had sanctioned housing loan of Rs.53.00 lakhs with interest @ 9% p.a repayable in monthly installment of Rs.39,750/- for 24 months, Rs.43,725/- for 36 months, Rs.47,686 for 60 months and Rs.56,312/- for 120 months. But the Ops increased the EMI amount from Rs.39,752/- to Rs.52,871/- without any information. That first Op is also charging more interest than agreed. Then he addressed a letter to the first Op on 21/10/2010 seeking reason for variation in the EMI amount. Because of global recession, his service was terminated by his employer with effect from 30/12/2008. As a result he is not in a position to pay regular EMI’s and therefore he requested the Op to restructure the schedule repayment but he did not agree. That the first Op has appropriated initial payment only towards interest without adjusting to the principal amount. Then the first Op issued a notice under Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act on 28/03/2009 calling upon him to pay Rs.59,83,104.62 within 60 days. Despite his request, the first Op has failed to give him credit statement of account undertaking his liability. That the men of the first Op started harassing him by visiting him and then after issue of notice under SARFAESI Act demanded Rs.6,03,565/- to regularize the account. Then he made arrangements to mobilize that amount to pay to the first Op and had got it ready. But thereafter, first Op increased that amount to Rs.6,56,436/- and demanded payment within the stipulated period. Then the first Op also revised the EMI’s from original 240 to 539 and interest rate was also enhanced without any intimation to him and stated that he has already paid Rs.12.50 lakhs towards the re-payment of the loan and despite he meeting the zonal heads of Op No.1 nothing has come out and therefore, alleging deficiency in the service of Op No.1 has prayed for direction to first Op to produce statement of account pertaining to his loan account from the beginning up to date undertaking the change in the rate of interest from time to time, directing the same Op to restructure the loan, to grant moratorium on or before which the complainant securing alternative job to facilitate to repay, to restructure EMI installment and to grant compensation of Rs.5.00 lakhs for mental agony and pass such other reliefs.<br /> <br /> Considering the grievance of the complainant and there being no prima-facie case made out against Op No.2. Notice was ordered against Op No.1 who appeared through his advocate and filed version admitting that BHW Home Finance Limited had sanctioned home loan of Rs.53.00 lakhs with interest @ 9% p.a repayable through EMI’s as stated by the complainant. But denied that they have abruptly increased EMI’s amount from Rs.39,752/- to Rs.52,871/-. It is contended that rise in interest rate is a common phenomenon which happens across all the banks and finance institutions due to the policy initiated by the Finance Ministry and RBI. The complainant had opted for variable rate of interest before sanction of loan and it was also explained to the complainant and stated that rate of interest is increased as agreed between the parties. The Op further denying all other allegations of the complainant has stated that the complainant had opted for a step up loan and explained that easy step up loan as a product designed for an individual who is looking for a lower strain in cash outflow in the initial phase of a loan without affecting his overall eligibility of the loan. The product is primarily targeted at a young group of executives who will have higher cash in flow at a later stage of the loan. The first phase of the payment of equated monthly installments will go towards interest component only and the division between interest and principal from the equated monthly installment paid shall start from second phase onwards and will continue till the end of the term loan. It is further stated that when the complainant did not pay the regular EMI’s and the account became non-performing have initiated action under Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act and notice dated 21/03/2009 was sent to complainant showing his outstanding liability of Rs.59,83,104.62 for repayment. That despite calling upon the complainant to pay Rs.6,03,565/- and to get the loan account regularized to avoid the account becoming non-performing he did not pay. Therefore, when the amounts accumulated by not paying the regular monthly installment payable amount due for regularization of the account got increased to Rs.6,56,436/- and denying any deficiency has contended that the complainant lack merits and prayed for dismissal of the complaint.<br /> <br /> In the course of enquiry into the complaint, the complainant and the first Op have filed their affidavit evidence reiterating what they have stated in their respective complaint and version. The complainant along with the complaint has produced the copy of loan agreement, copy of the loan sanctioned order, copies of several correspondences that took place between him and Op No.1 First Op has produced a copy of the loan sanctioned order with the terms and conditions and a copy of the legal notice that the complainant got issued to Op No.1. We have heard the counsel for both parties and perused the records.<br /> <br /> On the above contentions, following points for determinations arise.<br /> <br /> 1. Whether the complainant proves that the first Op has caused deficiency in his service by not giving the statement of account and not restructuring the EMI’s.<br /> 2. To what relief the complainant is entitled to?<br /> <br /> <br /> <br /> Our findings are as under:<br /> <br /> Point No.1 : In the negative<br /> Point No.2 : See the final order<br /> <br /> REASONS<br /> <br /> Answer on point No.1: As seen from the admission of both parties, there is no dispute in this complainant having had availed housing loan of Rs.53.00 lakhs from BHW Home Finance Limited. The complainant has not made that BHW Home Finance Limited as a party but submitted in his arguments that BHW Home Finance Institution is now merged with Op No.1 and that transaction is now taken over by the first Op. First Op has not denied it. It is also not further in dispute that the complainant was liable to repay the loan with interest @ 9% p.a in equated monthly installments on various dates in various amounts as narrated above. But the grievance of the complainant is that the first Op without any intimation to him has increased the rate of interest, increased the quantum of EMI payable and increased number of EMI’s which according to him is done without his knowledge and that cannot be done under law and it is further stated that the first Op has failed to furnish his loan account from the beginning till date. But the Op not only in his version and also in the affidavit evidence denied all these allegations of the complainant and contended that the complainant had opted loan with varied rate of interest. Accordingly, he is liable to pay variable rate of interest as and when it is revised based on the order of Finance Ministry and RBI and therefore denied any deficiency at his end. The counsel for the Op has invited our attention to loan documents including loan sanctioned order, loan application, the loan agreement entered into and certain communications they sent to the complainant.<br /> <br /> The complainant himself has produced a copy of loan agreement, the title of it reads as “loan agreement (Resident Indian-variable Rate Home loan). This title of the loan scheme speaks for itself the nature of loan sanctioned under the scheme which is a variable interest loan and it do not speaks about any fixed rate on the housing loan. In the definition of the agreement, the expression variable interest rate is explained that interest agreed upon is not fixed one but it is a fluctuating one. Further, the conditions of the loan particularly clause 2.2 under the heading interest it says until and as varied by BHW BHFL Ltd., the VIR which is nothing but variable interest rate applicable to this loan as on date of execution of the agreement is stated in the schedule. That as and when the VIR varies as per its prevailing policy, the borrower has to pay interest at the varied rate”. The complainant is a party to this agreement and signed to those conditions in all the pages. Further this agreement under which loan is sanctioned, under clause 2.4 (e) says the borrower acknowledges and accepts that the EMI/interest may not remain fixed during the tenure of the agreement. The EMI’s may/shall subject to change and be recomputed by BHW BHFL in the following events. The events given there and empower the financier to vary the EMI’s, The complainant is again a party to this document and signed to this condition. Accordingly, the complainant was a party to it. Therefore, bound by what was agreed. The conditions of this particular loan further empower the Op to vary interest rate and it says that VIR may be subject to change a maximum of 4 times every year. The complainant is not disputing this agreement and this condition of the loan. Therefore, when he is not denying to be a party to that document and having not questioned it can not contend to the contrary and say that the Op has enhanced rate of interest on the loan sanctioned to him.<br /> <br /> Coming to the prayer of the complainant for providing him statement of account of his loan account from the beginning till end is concerned. It is not the case of the complainant that he was not aware of the year during which loan was sanctioned and the outstanding amount due from time to time. The complainant himself has stated to had re-paid a sum of Rs.12.50 lakhs towards repayment of the loan and was not able to pay subsequent EMI’s because of he having had lost job because of recession. Therefore, it can not be said that this complainant was not aware as to what was the total amount he has paid and the amount that has become over due. The complainant has also admitted that Op has initiated action under the SARFAESI Act and the counsel for him submitted that he has participated in that proceeding on behalf of the complainant. The complainant himself has produced a copy of the notice issued by the Op under 13 (2) of SARFAESI Act under which the Op claimed a total liability amounting to Rs.59,83,104.62 and called upon the complainant to pay that amount within the fixed period. The complainant has not questioned this notice that is to say questioned the correctness of the amount claimed under that notice before us. The complainant it is found through his letter dated 20/04/2009 requested the Op to stop ECS/EMI till restoration of his employment for which the Op replied stating their home finance limited is an affiliated regulated company with National Housing Bank as it is regulator, they are bound by certain norms/guidelines which prohibit them from deferment of EMI’s based on any customers request. Therefore request of the complainant for deferring recovery was rejected. During these transactions and correspondences the complainant did not dispute the amount claimed by the Op and he did not ask for details of his account. On the contrary he offered to pay certain amount to regulate the loan account for preventing it as non-performing account. Even then the complainant did not pay and get the account one as performing account to avoid proceeding under SURFACIE Act. As we have read above and referred to the conditions of the loan, the Op is given liberty to revise the rate of interest as and when the interest rate is revised and to restructure number of EMI’s. The complainant being a party to it can not now question the act of the Op particularly knowing that he has been irregularly in repaying loan through EMI’s. Op again on 30/11/2009 sent intimation to the complainant that even that current months ECS was found due as per the repayment obligation and had even told the complainant that they will constrain to initiate action under the SURFACIE Act. The complainant himself has produced a copy of the letter of BHW dated 15/01/2007 under which it is stated that owing to increase in the interest rate under the financial market it has been forced for increase the rate of interest on complainant’s loan by a marginal 0.50 basis point (0.5%) with effect from 01/01/2007. The complainant has not denied the receipt of this intimation. Therefore, the complainant cannot contend that Op has revised the rate of interest and re-structured EMI’s payable without any intimation can not be believed. As the fact go uncontroverted the complainant has not been regular in repayment of the EMI’s and when he allowed the loan to accumulate the Op without any option, by acting under the conditions of the agreement initiated action which can not be held as deficient. Therefore, prayer of the complainant for furnishing him statement of account of his loan from the beginning up to date can not be considered and his further prayer to direct the opponents to restructure the loan and to grant moratorium until he secures a job cannot be entertained. Relief of granting moratorium is not permissible under law and under the conditions of the loan and the complainant as he is participating in the action initiated by the Op under SARFAESI Act he can have the details of account and we therefore, find no merits in this complaint and it is liable to be dismissed and we answer point No.1 in the negative and pass the following order.<br /> <br /> O R D E R<br /> <br /> Complaint is dismissed. Parties to bear their own cost.<br /> <br /> <br /> Dictated to the Stenographer. Got it transcribed and corrected. Pronounced in the Open forum on this the 16th July 2010.<br /> <br /> <br /> <br /> MEMBER MEMBER PRESIDENT<br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br />